Is this insurance right for you?

Several industry groups, government offices and consumer advocates offer tips to help understand long term care insurance.

Here are some of their suggestions and questions to ask, as well as some telephone numbers and addresses for further information.

Realize how the policies work

Most provide a fixed amount of coverage for each day in a nursing home or for home health care services like a visiting nurse, adult day care and other such services. Usually it’s from $30 to $100 or so a day. Some cover assisted living communities, which provide assistance with activities like eating, dressing and bathing. Almost all require a deductible period. Understand what the policy covers . . .

Does it require prior hospitalization before paying benefits in a nursing home or starting home health care, as some older policies do? Will it pay only for skilled nursing care, where you get 24-hour nursing and rehabilitative care? If so, this could be a problem if you need only custodial care, like help with eating or bathing. How long will the policy pay; consumer groups recommend three years as a minimum. . . . and what it doesn’t cover

Policies sold in Florida must include coverage for such things as Alzheimer’s disease, but they often don’t pay for mental illness, alcohol or drug addiction, treatment paid for by another insurer or the government, and attempted suicide. Your medical history does matter

Don’t let an agent tell you otherwise. You can be denied coverage for an existing condition, like heart disease or Alzheimer’s, if you have it when you try to buy the policy. Don’t buy insurance you can’t afford

This sounds simple but think about it. Some analysts recommend you spend no more than 10 percent of your annual income on such policies - unless you have large assets you want to protect if you get sick, like a house, business or stocks and bonds. If you are getting by on Social Security and have few assets, it might not make sense.

Consider buying inflation protection

This is important especially if you think you won’t use the policy for a few years. Nursing homes in Florida cost about $80 to $100 a day, which is usually what the policies cover after a deductible period that often runs 100 days. But the costs have risen quickly in recent years and there is little reason to expect it to stop. Without buying the inflation rider on the policy, you could be stuck with benefits that don’t cover the cost of your nursing home or home health care. Florida requires companies to offer at least a 5 percent annual inflation protection as an option.

You’re protected from cancellation

In Florida your policy can’t be canceled, unless you don’t pay or you lie about your medical history. But your long term care insurance rates can go up, if they are raised for all policyholders. The insurance is not cheap

Comprehensive policies that cover nursing home and home health care, with inflation coverage and coverage for from three years to lifetime, likely will cost from $1,000 to $2,000 a year per person for someone who buys a policy at age 65. There is usually a discount if a couple buy the coverage together. The cost increases quickly - sometimes doubling or quadrupling - if the policy isn’t purchased until age 75 or later. Some companies won’t sell to people over age 79. Check for group insurance coverage

Many businesses are adding the policies as an optional benefit for their employees. Such group plans can lower the annual premiums.

Review your old policy

Many of the critical comments about long term care insurance quotes involve older policies that set rigorous standards before paying benefits. A newer policy, with more lenient benefits, might work better - although it likely will cost more than what you are paying. Don’t feel pressured to buy

You have the right to take the company’s policy and review it with family, friends or your attorney.

Check out the agent or company- make sure the agent or company is licensed to sell in Florida. Call the Insurance Department’s Consumer Helpline at (1-800) 342-2762. You have a 30-day free-look period

By state law you can review the policy for 30 days and then cancel it for a full refund. If you return it, the Florida Department of Insurance recommends you do it by registered or certified mail.

Medigap health insurance plans

Recent (or about to be) retirees with medicare  insurance may not realize how few offers for private Medigap policies (to fill in where Medicare leaves off) are coming their way by phone or mail. The main reason: A 2010 federal law prohibits selling duplicate insurance protection, whether from employee benefits individually. That is if you have medicare supplement insurance that doesn’t cover costs as much as you like, insurance companies cannot sell you another policy if any part of it duplicates what you already have.

Extra policies to help pay for long-term care, cancer or other dread disease, $100-a-day hospital payments, etc., are likely to have coverage in bits and pieces and duplicate what you have, says Noel Morgan, consumer advocate at the Ohio Department of Insurance Senior Health Insurance Information Program.

Morgan explains: Say you have an employee retirement health care plan which has a dollar-benefits cap, or which pays 80 percent of your actual costs. You pay 20 percent, Medicare pays 80 percent. But 80 percent of your 20 percent can leave you with a high due bill; so can a dollars cap.

Dropping a limited benefit employer’s health care plan in order to buy a better one isn’t always possible when insurance benefits are part of a union contract.

Consumers aren’t breaking the law when buying extra health insurance, says Morgan. The law was meant to protect consumers from buying more than one Medigap policy with duplicate benefits. The law applies to insurance companies; and each violation is subject to a $25,000 fine and prison stay. Yet, Morgan adds, insurance companies-including some big names-continue to sell duplicate medicare insurance plans. And as long as you sign and the company accepts the contract, the company must pay the benefits listed.

Who enforces the law? After three years, the federal government hasn’t decided which federal agency will be the enforcer, Morgan adds. And, changes in the law to soften it for consumers’ need has failed in Congress - the most recent proposal was dropped from President Obama’s budget bill.

The Medicare and Medicaid cuts would help fund new benefits for seniors in the form of a medicare drug benefit and the beginnings of a long-term home and community health care program. But seniors have felt that the new benefits are not enough. To avoid attracting only high-risk subscribers  elders could sign up for the proposed new program only when they first became eligible for Medicare, usually at age 65, and for a limited time afterward.

14 Safety Tips for Aparment Living

There is no such thing as a burglarproof home or apartment.

“An apartment house is a neighborhood,” says Detective Sergeant Gary Hoss  from Houston. “It just happens to be vertical.”

Getting to know your neighbor in an apartment complex is just as crucial to crime prevention as it is in a neighborhood of single-family dwellings.

There is safety in numbers - a well-organized tenant association, for example, is a good first line of defense against crime of any kind.

It is just as important in Apartments in Houston to obey the simple rules of common sense: Don’t assume, for instance, that a main entrance downstairs guarantees protection. Always install a dead-bolt lock on your apartment door and a peephole.

Here are other tips for the apartment dweller from crime prevention program:

Never allow strangers to enter without proper screening. Refer solicitors to the manager.

Do not “buzz” the door open to anyone you do not know, and watch that strangers don’t come into the secured building as you leave.

If you are a woman living alone, use initials instead of your full name on the identification slot in the lobby.

Don’t leave notes for delivery people or others on your door that advertise your absence.

Check the elevator when it arrives, and don’t get in if there is someone there that you are uncertain of or consider “suspicious.”

Women riding in an elevator alone should always stand near the control panel. If accosted, press all buttons.

If a suspicious person enters the elevator while you are on it, exit before the door closes.

Always survey the hallway when you leave the elevator.

Avoid using the apartment building’s laundry room by yourself. Team up with a neighbor.

Make sure the lock or the key cylinder has been changed when you move into a new apartment.

Lock all doors and accessible windows before you leave your apartment.

Use a timer for a lamp or radio to make your apartment appear occupied when you are out late or on vacation.

Notify the building manager if you leave on vacation or other extended stay away from home.

Always report suspicious sounds, strangers or odd behavior.

Travel Insurance

What could be more pleasant than thumbing your nose at the rest of the world as it shrinks from sight through an aircraft porthole? With umpteen hours of travel ahead and cocooned in space with an exquisite dry white, you could read your visitors insurance brochure and reassure yourself that all is well. Or you could enjoy yourself instead.

Reading travel insurance is best saved for a day that is horrid to start with. Once you get past the pictures of Big Ben and the Statue of Liberty, there’s a black hole full of fine print.

You are better off buying a policy you can easily read and understand than one which is crammed with gobbledegook. Besides, when you buy a policy you sign a declaration saying you have read it and understood its contents. So take a handful of brochures home with you and take your time.

But it is vital you buy your travel insurance before you pay for your ticket and travel arrangements, otherwise you will not be covered against loss of deposit and cancellation charges if you have to cancel due to unforeseen circumstances.

Premiums and benefits generally depend on your choice of destination. To get adequate cover for travel to the US or Japan, for example, you generally need the maximum level of cover.

This is because medical expenses are very high in these countries and anything short of unlimited medical cover is a risk. So benefits (and therefore premiums) are highest for those regions.

Most insurers offer three levels of cover, although some carve the world into four geographic regions while others offer just two levels of cover.

Travel insurance offers a core of basic benefits including: emergency medical and dental care; refund of deposit and cancellation charges; additional travel and accommodation expenses; loss of baggage; accidental injury or death; personal liability, and hijacking.

Some insurers add extras such as: free cover for dependent children travelling with single parents or grandparents; loss of income benefit if you are injured on holiday and unable to work on your return; and resumption of journey - this is a benefit towards the cost of returning overseas if your holiday is disrupted because of a relative’s death or illness.

But there are exclusions and conditions attached, so claiming for any of these events is not all plain sailing. Getting compensation for something as simple as loss of baggage can turn into a nightmare, as the story below illustrates.

Most complaints heard by the panel are for claims rejected by insurance companies for stolen and lost baggage, usually on the grounds that the insured did not take reasonable precautions to protect possessions, or left them unattended in a public place.

Here’s a typical example. A man was travelling to Los Angeles and, due to the riots in that city, his flight was diverted and arrived in San Francisco at 11 pm, where a curfew was in force. He had no option but to spend the night at the airport.

He collected his luggage and placed it under a couch-type seat. When he awoke five hours later his money belt had been cut from his waist and his luggage was gone.

He reported his loss to the airport police. The insurance company rejected the claim on the grounds that the luggage and/or personal effects had been left unattended and that he had failed to take all reasonable care of them.

The panel upheld the company’s decision - at least for the luggage. Had the insured fallen asleep while guarding the luggage the result may have been different. But the insured took a positive decision to settle down and go to sleep, leaving his luggage unattended. The airport had a storage facility and his failure to use it amounted to a failure to take reasonable care.

But the panel ordered the company to compensate the man for the loss of$US350 in stolen cash as he was not regarded as having failed the test of reasonable care for keeping his money on him.

Pre-existing illness is another area which gives rise to many disputes. If you do not disclose an existing ailment to your insurer, you may well have any medical and dental claims knocked back.

“Pre-existing” is defined variously by insurers, with some taking a harsher view than others. It is usually defined as a known illness - either recurrent or one for which you have consulted a doctor for up to 90 days previously(pregnancy is treated as a pre-existing condition).

Insurers will generally cover pre-existing conditions for an additional premium once you have produced a doctor’s certificate showing you are fit to travel.

Most policies cover medical evacuations, but it is not enough for you to feel more comfortable being treated by a familiar person in Australia than the local doctor or hospital in your host country. The circumstances under which repatriation is carried out are limited by the terms of the policy, which are very tight and require the agreement of the insurer.

Similarly, while cancellation and additional expenses provisions offer peace of mind for emergency situations, such as a family member falling seriously ill or dying in Australia, there are exclusions that make such claims difficult to qualify for.

If the relative had a preexisting condition, for instance, it is likely you will not be compensated.

Another area to watch is high-risk sporting activities. While some insurers exclude these outright (or through waivers buried in the fine print), others are prepared to cover them. For instance, HCF will cover, at no extra cost, amateur snow skiing, water skiing, paragliding, parachuting and scuba diving, if you have an appropriate certificate. Cover-More will cover bungy jumping, ballooning, abseiling, parasailing, parachuting, paragliding and gliding at an additional premium.

Senior citizens are sometimes charged a loading. HCF charges 50 per cent more for travellers aged 70 to 74, and 100 per cent more for travellers over 74. Qantas, on the other hand, does not charge an extra premium if you arrange your trip through a Qantas Travel Centre, or you have a ticketed reservation on Qantas during the period of your cover. Some insurers will also ask for a certificate of good health from your doctor.

As was shown by Money’s survey of credit cards, some cards also offer free travel insurance. However, this is usually limited to accident insurance, with payouts ranging from $100,000 to $500,000, and so will meet only part of the needs of most travellers.

Liability insurance is required by law

In today’s society, you should have liability insurance to protect yourself against lawsuits. Homeowners and other real-estate owners buy insurance to protect against injuries on their property; auto business owners buy garage keepers liability insurance for protection against auto accidents; doctors, lawyers and other professionals need insurance to protect against malpractice claims.

While liability insurance is necessary to protect your life savings against lawsuits, it may not be sufficient. The insurance company that you expected to cover you against liability claims may disappear, exposing your personal savings to seizure.

A majority of firms with 1,000 employees or more are ready to contract product liability insurance to cover the risk of damages payments related to defective products.

In the manufacturing sector, one in every three firms intends to take out such insurance, according to a recent survey of the Marine and Fire Insurance Association. The survey covered about 4,800 companies.

The product liability system makes it easier for consumers to claim payments of damages inflicted on them by defective products, leaving manufacturers more sensitive to the management of risks involving their products.

The product liability system is expected to create a fresh market worth 200 billion dollars for the nonlife insurance industry, an industry official said.

The State Corporation Commission determined today that liability insurance is “readily available for most consumers with prices relatively stable,” and that the market generally is competitive.

However, the commission expanded its list of potentially non-competitive insurance lines to include environmental damage, asbestos abatement by commercial contractors, public housing and a broad range of products.

Liability for environmental damage, especially for underground fuel storage tanks, headed the list of new SCC concerns this year. Those lines were named most frequently by consumers surveyed for their views on the availability and affordability of liability insurance.

Insurance industry listens, dial its hot lines

The insurance industry, responding to both consumer confusion and disaffection, has opened a telephone Helpline to field all types of insurance questions and some complaints.

“We feel this is an example of industry desire to improve credibility with the American public. And we felt a need for an industrywide program. We want to be more responsive to consumer needs,” said Harvey Seymour, spokesman for the Insurance Information Institute, which represents property and casualty insurance companies.

The insurance industry endured a tough year in 1989, he said. California passed Proposition 103, which temporarily rolled back auto insurance rates. (The California Supreme Court since decreed that insurance companies have a right to make a reasonable profit.) Insurance was lashed in headlines ranging from “When an insurer fails,” in the New York Times in March to “Elderly urge Celeste to block increases in insurance rates” in The Plain Dealer in December.

And after shelling out $4 billion for Hurricane Hugo, the industry was hit with another $1 billion in claims from the San Francisco earthquake, Seymour said. Then Medicare catastrophic coverage was canceled and insurance companies were left scrambling again.

Increasing consumer concern and confusion were already being monitored by two insurance hot lines.

The insurance institute has operated one since 1981, “to make property-casualty insurance more understandable and offer unbiased information” said Seymour. Two years ago, the hot line received only 20,000 calls; last year, it logged about 70,000.

The Health Insurance Association of America maintained a hot line with the American Council of Life Insurance for 8 1/2 years; then went it alone after the council dropped out 1 1/2 years ago. The health insurance line has been fielding “lots of questions,” especially from older consumers, about such issues as Medicare supplemental insurance, long-term care insurance, and simply the meanings of words used in policies, said Melanie Marsh, hot line manager.

“A lot of our consumers are over 65 and may have been visited by three or four different agents trying to sell one type of policy. They call and tell us how nice the agents were, but that has nothing to do with the products being sold. They need lots of help to sort out the details,” said Marsh.

But callers often couldn’t distinguish one hot line from the other and many were frustrated when referred elsewhere, said Seymour. And the life insurance council was ready to renew hot line support.

“We felt an increasing need to provide assistance in a generic way, an increasing demand for attentiveness, in the last year,” said Henri Bersoux, spokesman for the life insurance council.

“The needs of the consumer are changing and the insurance industry is trying to adapt. Baby boomers are more concerned about loss of lifestyle than loss of life,” said Bersoux. And older policy owners are asking about cashing in insurance policies before death to avoid becoming penniless during catastrophic critical illness.

So on Jan. 1, the new insurance hot line was born to provide one-stop shopping for insurance information, and more comprehensive answers. In addition to the three major sponsors, a number of smaller insurance trade groups are supporting the hot line.

Free booklets covering answers to most-asked questions — and topics of great concern to insurers — will be sent, on request.

“And if we get a call from a consumer who is having an argument with an insurance company, we try to put the person in touch with a specific individual at the company,” said Seymour.

After Hurricane Hugo, the old insurance institute hot line quickly connected many people with their insurance company claim centers and “adjusters handled claims so promptly that many were hailed as local heros,” he said.

A sad revelation for many tenants after the hurricane, however, was that landlords do not insure tenants’ personal possessions, only buildings, he said. Tenant household insurance is vastly underused, even though it’s quite cheap, he said. While 95% of homeowners carry homeowners’ insurance, only 23% of tenants carry tenants’ insurance.

Insurance becomes fast growing industry in Russia

The rate of year-on-year insurance premium growth (222%) in the first half of 2009 exceeded the increase in consumer prices (210%), producers’ prices (145%) and GDP growth. Thus, the relation between the consolidated national insurance premium and GDP stood at 2.17%, compared to 1.5% in 2008, bringing Russia closer to the level of the most developed Western European countries, where the relation fluctuates between 2% and 3.5% of GDP.

This enabled Russia to fulfill one of the indicators laid out in a document on the development of the national insurance system in 2008-2010 early. The relation of insurance premiums to GDP is expected to stay at 2%-2.5% in 1999. Insurance, therefore, has made it as one of the most successfully developing industries in Russia.

A decline in the number of registered insurance companies and a reduction in actually functioning companies accompany the increase in the nominal amount of insurance operations. There are 1,724 working insurance companies in Russia, down by about 25%  from the beginning of 2008 to mid-2009. A total of 1,369 insurance companies provided information on first half results, 113 of these did not carry out insurance operations, making the total of functioning companies considered 1,247 or 73% of total registered companies.

Per capita insurance premiums remain extremely low. An increase from 124 rubles in the first half of 2008 to 275 rubles in the first half of 2009 cannot be considered significant enough to increase the level of insurance protection. Insurance premiums may have gone up to 2% of GDP, but that can be attributed to Russia’s relatively low GDP.

It is still early to start talking about the restoration of insurance premium and payment volumes in dollar terms. Insurance contributions totaled around $1.7 billion in the first half of the year, about 42% down on the same period in 2008. Insurance premiums per head dropped from $20 to around $12. Average half-year per head premiums top several thousand dollars in various developed countries and over $100 in East-European countries. Therefore, despite the relatively high rate of development in the insurance sector, the level of insurance protection for Russians remains low. INSURANCE COMPANIES SUCCESSFULLY COMPETE WITH OTHER FINANCIAL INSTITUTES FOR CLIENT FUNDS. The reasons behind production growth in export-oriented and import-substituting industries are clear, but the reasons behind growth in the insurance sector, which virtually does not export its services, are not so clear. Also, there are no nonresident insurance companies being forced out of the Russian market, as they are restricted from providing insurance services in Russia, apart from reinsurance. The volume of reinsurance services offered by nonresidents has probably even gone up in the first half of 2009, which has not only not hindered growth in the national insurance premium but is likely to have facilitated the process.

An explanation for the growth in insurance premiums lies in the analysis of their structure. Life insurance, which continues as in the last quarter of 2008 to account for the largest share of insurance premiums (39%), showed the biggest growth. The share of life insurance went up over 50% compared to the first half of 2008 and now exceeds the consolidated share of other voluntary insurance. Life insurance premiums probably increased less because people began to want to insure their lives or companies wanted to insure their employees and more because clients were interested in lowering tax and quasi-tax withdrawals from salary funds. Various points back up this theory, for example, the number of insurance agents through which classic life insurance policies were sold remained relatively unchanged. Also there were an extremely high level of life insurance payments (80%), just 10% under mandatory insurance and a seven-fold increase in life insurance loans, allocated by insurance companies to their clients. The share of personal insurance declined considerably probably due to the lower demand for voluntary medical insurance and accident insurance, that is, insurance which is most similar to life insurance. There was slower growth in private deposit account balances in commercial banks, whose salary payment services had been popular before the financial crisis.

Among the voluntary types of insurance, property insurance premiums also increased sharply. Center for Economic Analysis experts attribute the increase to the greater ruble insurance sums, as property costs and liability limits are usually fixed in dollar equivalent.

Mandatory insurance premiums went up 30%, due to slow growth in the national salary fund, the population’s high share of hidden revenue and the static minimum salary. Thus, the share of mandatory insurance in all types of insurance has virtually dropped to its 2004 level. LARGE INSURANCE GROUPS ARE BECOMING STRONGER ON THE INSURANCE MARKET. Russia’s market already has several dozen insurance groups responsible for the dominating share of assets and insurance transactions. Insurance groups usually come about through financial, industrial or financial-industrial groups, natural monopolies and regional administrations. However, there are at least two groups with ten-year histories. These were formed in a particular way.

Ohio Bank Approved To Expand Financial Services

The First National Bank of Zanesville recently gained approval from the Office of the Comptroller of the Currency to move into the financial planning, brokerage, insurance and annuities businesses, in a move to help expand its market presence.

The $1.2-billion-asset parent company, BancFirst Ohio Corp., recently acquired Chornyak and Associates Inc., a financial planning firm which also sells insurance but is not a full-service broker. It receives a commission, however, if customers purchase the mutual funds the planners recommend. The bank already has a trust company with insurance capabilities, but it was a small part of its business activities, mainly selling life insurance and annuities, according to chief financial officer Kim Taylor. Taylor said the trust subsidiary also offers some customers brokerage products.

"This provides a higher level of financial planning services to our customer base," he said, explaining the bank will provide the firm with its list of bank customers to solicit products, and brokers already in the bank’s branches will refer customers to the new affiliate.

Chornyak is located in Columbus, 50 miles from the Zanesville headquarters, and provides the added bonus of giving the bank additional presence in that market, where it currently has only one branch.

BancFirst acquired the financial planner by issuing 82,000 shares of stock, valued at around $2 million. The company is expected to bring in revenues in the $1.2 million-$1.6-million range.

Huntington Shoots For Title Insurance

Huntington National Bank recently received approval to get its foot in the door of title insurance sales in Ohio, anticipating a time when banks in that state will be able to own title insurance companies entirely. An accompanying lawsuit could have a significant impact on financial modernization legislation.

The Columbus-based company received approval from the Office of the Comptroller of the Currency April 8 to own a 10% stake in a local title insurance agency, Mound and Forth Title Agency, Ltd. In the application letter from the bank’s counsel to the OCC, the bank said the only reason it was applying for a minority stake is that it is prohibited from owning a majority interest in the company by state law. It added that it believes the state law is inconsistent with federal law and is "a prohibition or significant impairment on the powers of a national bank under the National Bank Act to own and operate a title insurance agency "

The bank, along with the Ohio Bankers Association, is suing the Ohio insurance commissioner in federal court to rectify that situation. Oral arguments are scheduled for this week.

Jeff Quayle, general counsel for the Ohio Bankers Association, said the state rule barring banks, Realtors, homebuilders and others from owning a title insurance company or a controlling interest in one "flies straight in the face of Barnett." Barnett refers to a Supreme Court decision which overturned an antiaffiliation law that severely limited banks’ ability to sell insurance to their customers. While bankers are fighting the rule in court, the Ohio Association of Realtors is working to overturn it with state legislation.

He added that the model Huntington is following of minority ownership has been done by other non-bank companies, such as homebuilders.

Industry watchers believe the case could have far-reaching effects on the banking and insurance industries because of its impact on financial modernization legislation.

"If this goes through before H.R. 10 passes, then clearly national banks can sell title insurance and it would be much harder for them to hold the provision in the House version of H.R. 10 that prohibits the sale of title insurance," said Buzz Gorman, legislative counsel for the Conference of State Bank Supervisors.

Synovus Goes The Extra Mile

So devoted to the ideal of customer service are bankers at Synovus Financial Corp. that some will work nights and weekends. That extra touch they believe will set them apart from competitors was highlighted when a customer called the head of private banking–a program only a year and a half old–on a Sunday night. He announced he was leaving the country for a trip in the morning and would need a passport. The banker opened up the customer’s safe deposit box and produced the needed document.

"The products we deliver are all pretty much the same, but where we’re going to beat the competition is we’re going to deliver them however and wherever the customer needs it. We have better relationships because we extend ourselves," said Walter M. "Sonny" Deriso, Jr., vice chairman of the board of Columbus, Ga.-based Synovus, and the executive in charge of the company’s "New Bank" effort.

The New Bank program means moving toward modernization of the company, which translates into delivery of products and services in ways that customers want, Deriso said.

The bank is stepping up catering not just to the wealthy–with the private banking program it’s rolling out to 10 more of its subsidiary banks from the pilot site–but to the ordinary customer’s needs. It recently completed a 14-month conversion to M&I’s data warehousing capabilities and can do more sophisticated target marketing.

The $10.5-billion-asset holding company, which maintains independent boards and charters at each of its banks, is gearing up to complete another chapter in its New Bank effort. By adding insurance bank-wide, and brokerage and financial planning services for all customers, the southeastern bank company hopes to round out its offerings and achieve what is becoming the holy grail for banks: to be the place where customers get all their financial products.

The three-phased introduction of the insurance subsidiary has begun at flagship Georgia-state chartered Columbus Bank &Trust (CB&T) and two other banks in Alabama and South Carolina. The final state in Synovus’s market, Florida, has somewhat simpler insurance regulations, and will be added after the pilot periods in the other three states.

After examining a study of other banks’ methods of offering insurance prepared by KPMG Peat Marwick, which showed most are not profitable yet, and speaking with its own bank managers, Synovus management decided not to acquire an insurance agency. It will instead offer insurance to its customers through a partnership with a third party, which has been chosen but will not be announced until June, Deriso said. The carrier will provide backroom operations, a call center and licensed agents who can work as consultants or specialist to customers with sophisticated needs, Deriso said. The bank plans to get customers to the insurance agents, who must be located in a separate area of the bank, by referrals from tellers and customer service representatives, and targeted marketing.

The first phase of the three-phase roll-out includes the simplest products for novice salespeople to understand: credit life and accident insurance which most banks have offered for years, and fixed annuities, which Synovus has offered for about a year. In addition, it will offer title insurance, through a partnership with a local firm, and worksite-related supplemental insurance for commercial customers with specialist AFLAC.

The bank is also creating a reinsurance captive for mortgage insurance. In that line of business the bank will deal with several carriers, the split depending on the amount of work done by the bank or the carrier. Because reinsurance is still a fairly new line of business for banks, Deriso said special approval would be needed from regulators. He added that he had discussed the bank’s plans with regulators in all four states as well as with the Office of the Comptroller of the Currency, and all were comfortable with the bank’s plans and indicated there should be no snags in obtaining approval.

The second phase, to begin in the fourth quarter, will offer homeowners and auto insurance. The third phase, to start late in the year 2000, will offer life, disability, long-term care and group disability insurance.

Deriso said in addition to having some employees trained to sell insurance, the plan is to have some of these specialists licensed to sell securities and be able to do financial planning for all customers. Currently, the banks can offer some customers a limited version of that service. Some of the specialists on the asset-management side of the bank can act as gatekeepers and refer some of the trust clients to the brokers. Whenever an annuity is sold, that customer has a financial profile done, a sort of minifinancial plan. But CB&T will begin piloting in May the use of what Deriso calls "superpeople," employees licensed to sell insurance and all brokerage products.

Another new program which Deriso said ties several of the bank’s financial services together, an asset management account, also requires specialist employees to sell it. In the pilot stage now and set to be rolled out in the second or third quarter, the wealthy-customer’s account has a brokerage feature and allows funds to be swept into an FDIC-insured account. The specifics of minimum account balance–probably around $10,000–and working with the data processor to clear all trades, are being worked out now.

Deriso is in the thinking stage now of the latest piece of the plan to offer customers as broad an array of financial services as possible: additional money management. He is grappling with whether to hire more money managers to complement the team that runs the company’s fixed income and equity funds, ranked by PIPER in the nation’s top ten, or to form an alliance to continue to get value from the $7 billion under management with an outside firm